Science & Technology

A research show where the rich really get rich.This is the reason

Few topics are as polarized as wealth. Everyone has the idea of ​​how to spread it, what is wrong in society, and some people have too much money and some have too little money. But no matter where you stand in the discussion, one thing seems clear: wealth produces wealth. It’s not just a myth. New research You can see that the rich are really rich and they remain rich.

Welcome to the machine

The rich will be richer. It’s a fact of life. Or is it? Is that really true, or is it just one of the things people say? Existing research Income increases, The wealth gap Become wider, And likely a pandemic Not helping.. However, detailed data on wealth remains very rare. However, certain Norwegian laws have helped.

In a new study, economists from the IMF and other institutions analyzed Norway’s 12-year tax record and gave an unprecedented view of how wealth evolves over time. Data was available because Norway has a wealth tax and the assets must be reported to a third party to prevent errors. The data were published under certain conditions, allowing researchers to analyze statistics from 2004 to 2015.

The data show that the rich actually get rich, mainly because they get higher returns from their investments.

Most people are quite wealthy because Norway is one of the wealthiest countries in the world. But the wealthier people in the first place tended to be wealthier. If 25% of the poorest people in the spectrum invested $ 1 in 2004, they would average $ 1.5 by 2015. This is a 50% return, not bad for 11 years. But someone in the top 0.1% will get a profit of $ 2.4, or 140%.

There was another important finding: people at the top of the wealth scale don’t seem to actually fall from this top, even if researchers control their background, and other factors, respectively. In other words, it’s hard to reach the top of the wealth scale if you’re not there in the first place.

Risk, Mula, and Wealth Tax

So why does this difference in reward appear? The common wisdom is that wealthy people can tolerate risk and make more money from now on, but it doesn’t seem to be the case. Instead, researchers have discovered that wealthier people may be exposed to unique investment opportunities or that wealth managers may be able to afford it. Financial education, information, and relationships are also important — and that’s exactly what High Status offers to you.

Researchers point out that wealthy status appears to persist over time, across generations. However, while rich children remain rich, they usually do not pay as much as their parents. After all, wealth is inheritable, but skills and talents are not so inherited.

Of course, there are important caveats to this study. Since it was conducted in Norway, the results may not be representative of the rest of the world, but the points to note are: Norway is one of the most progressive countries in the world when it comes to taxation. The country imposes a net wealth tax of 0.85% on individuals’ global wealth (all assets they own, regardless of where they are). Taxes are levied on net worth over $ 170,000.

In other words, if Jeff Bezos and his $ 182 billion are Norwegians, he would have to pay $ 1.5 billion in taxes each year. Also supported by 2020 U.S. presidential candidate Elizabeth Warren Wealth tax To the super rich who were considered Outrageous in AmericaBut here is that despite this wealth tax in Norway, the rich have become even richer. This is surprisingly consistent with what the economists who supported Warren claimed. Wealth taxes do not stop the rich from becoming rich, but they do so at a slower rate, instead in a way that helps the rest. Creating extreme economic inequality.It is the most in shape Well discussed, Idea Wealth tax Applies to millionaires in the United States.

The Gini coefficient is a commonly used indicator of economic inequality. Image via Wikipedia.

Despite its limitations, this study is consistent with Other studies..There are surprisingly few studies on income inequality, but most of it is whenever wealth is created. 1% pocket..

Economic inequality, Rapid growth in many parts of the world, Is more than just a moral issue. It is associated with higher crime rates, lower overall economic growth, and market trends. Togo “Bubble to bubble”.Recent research Found Economic inequality also leads to higher anxiety and even terrorism.

A research show where the rich really get rich.This is the reason A research show where the rich really get rich.This is the reason

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